Wednesday, September 26, 2012

“I’m sure you want to be No. 1 . . .”

. . . You have to figure out a way to be competitive . . . Restrictions in the Constitution and business conditions in general do not make American investors as excited to invest in the Philippines as they are elsewhere in the region,” says US ambassador to the Philippines Harry K. Thomas Jr. [Business Mirror, 29th Aug 2012.] “American businessmen talk about transparency in government, speed in decision making, the court system and predictability.” [Manila Bulletin, 29th Aug 2012.] “He noted that there have been $150 billion worth of American investments in the ASEAN region of which $100 billion were invested in Singapore and only the remaining $50 billion in the rest of southeast Asian countries.” What was left unsaid is: what are you waiting for?

Why speed? Four fundamental drivers are converging to force transformational change of businesses & industries fast: Technology, Customers & Markets, Globalization and Partnerships.” That’s from “The Working Group, Report of Findings, The Conference Board, October 4-5, 1999.That was many years ago but the writer, who was part of the working group (of Fortune 500 companies), still remembers “why speed”! And in his blogs the writer would simply summarize it in one word: competitiveness. And which he defines as: investing in technology and innovation as well as in education or talent, product and market development.

And thus it’s not surprising that Singapore is up there in competitiveness, which has created for the Singaporeans a virtuous cycle and hence their ability to corner a big chunk of US investments, among others. And so the ambassador “also advised the Philippines to look at other countries like Vietnam, Singapore and Cambodia on their strengths in attracting foreign direct investments.” [ibid]

The good news is President Aquino has been persistent in his fight against corruption and thus has attracted foreign direct investments. But as the ambassador says, and confirmed by the study of the Conference Board, we must learn to move with speed. We have yet to realize and recognize that instinctively we’ve been giving ourselves too much slack when the 21st century world is vigorously competitive. No pain, no gain! For example, no one is saying that fixing our power situation and flood control is easy. Nor is it easy to get our road maps in agribusiness or manufacturing, among others, done and executed.

The question to ask ourselves is: how could the Singaporeans – and now the Vietnamese and Cambodians – be doing a better job of attracting foreign investments? Do we have a problem with self-esteem? [“Only in New York,” as the saying goes, is psychiatry good business – because people recognize that they could have a problem with self-esteem. The problem, of course, is when they go to the opposite extreme.] If it is not self-esteem, is it our parochial bias that makes us unwittingly restrict our worldview and thus struggle to embrace a wider playing field, including foreign investments? “Foreign and domestic investors express concern over the propensity of Philippine courts and regulators to stray beyond matters of legal interpretation into policy-making and about the lack of transparency in these processes. There also are reports of courts being influenced by bribery and improperly issuing temporary restraining orders to impede legitimate commerce . . .” [Business Mirror, 29th Aug 2012] And for whose benefit?

In short, we must heed President Aquino’s call for the “straight and narrow” or his “daang matuwid.” Put another way, we have to internalize the power of simplicity. Absent simplicity speed is elusive which then engenders a culture of compromise (e.g., influence peddling) thus undermining the common good while preserving the power of the few. And as we lag in progress and development we would find ourselves in a bigger and deeper hole making the pursuit of transparency, speed and predictability even more daunting?

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